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What is Manufacturing Strategy and Implementation?

What is Manufacturing Strategy and Implementation?

Manufacturing Strategy

Manufacturing strategy consists of bringing the three primary pillars of manufacturing effectiveness into perfect alignment. The three pillars include organizational leadership, customers (or consumers), and operations execution. Let’s dive into each of these pillars to better assess the role of each in manufacturing strategy:

Organizational Leadership – The role of Organizational Leadership is to first decide who the company will serve and how. There is an art to choosing your customer, which is an optimization of two primary criteria: easy (for the company) to please and happy to pay what the company needs them to pay. Granted your company may not have a tremendous degree of control over either of these levers but getting this as right as possible at the onset primes the company for growth and success. A less than optimal arrangement sets the company up for some painful realities of doing business. Leadership needs to decide if its worth the trouble / effort to keep a segment of customers happy or if it makes sense to simply choose another customer to serve. This has to be weighed along with the company’s mission, financial goals, and other business obligations.

The Customer– The customer’s role in manufacturing strategy is to define when to deliver it, how many to make, what variant to make, and where to put it. Since no one customer can explicitly provide this information for you (unless you only have one customer, ie Walmart), excellent data needs to be collected and used as a guide to understanding these expectations. Customers speak to the manufacturing process in two ways:

1) By pulling their wallets out and making the purchase. This is the single most powerful way that customers communicate. Here is where the data is extremely useful. Ideally, you would be able to capture the entire body of purchasing data within your industry or sector for analysis. This would include not only your own company but your competitors’ data as well. Again, the answers you want to glean from the data are when, how many, what variant, who buys it and where to put it in order to meet or exceed business goals.

2) The other way customers communicate is through feedback. In today’s world, feedback is readily shared through both formal and informal channels. In the information age that we live, there is no excuse for companies to not know, with intimate detail, what their customers are experiencing with the company’s products. This is vital information that needs to be systematically aggregated and used as a critical input to the company-wide continuous improvement processes. The sooner the company can identify patterns in feedback (including feedback for competitors’ products) and get positive changes incorporated into the manufacturing process, the stronger case that company makes to win and keep business.

Operations Execution – Once the customer is chosen and you know how they like it, its the job of Operations to execute to perfection. This means optimal quality, cost, and service levels with perfectly healthy and happy employees on the shop floor doing the work. This means having a robust culture of innovation to not only meet customer expectations but to be able to continuously delight above and beyond the competition. This also means having the agility to change capabilities on a dime to keep pace with changing customer tastes and preferences. And finally, this means leading the way on technological advancement to continuously drive greater agility and perfection in execution.

Implementation

Implementation is the ability to establish absolute alignment between all three pillars mentioned above and taking the steps needed to create perfect synchronization between the three. This is evident when the vision in the C-Suite can be witnessed in action on the plant floor. This is only achievable by establishing and cultivating a culture of problem-solving, and the problems being solved can be tied directly to the results from the aggregated feedback analysis from customers. If the business requires V quantities of W product at X price to be delivered to Y customer by Z time, then perfection means achieving this standard without fail and with outstanding quality. Implementation is engineering the business system to deliver perfection. The implementation process includes three primary steps: assess, design, and test. These steps should be repeated until the business system verifiably delivers to your standard of perfection. Once this is done, you have achieved optimal manufacruring efficiency.